02
Feb
French_Flag

Let this be a lesson to all major tech companies: if you have a ton of users and you want to enter a new market, you'd better charge some kind of arbitrary fee, lest you end up in trouble with the French judicial system. Google is feeling that sting this week, as a French court ordered the company to pay €500,000 in damages to Maps competitor Bottin Cartographs as well as a €15,000 fine.

The plaintiff claimed that Google was using its market dominance to muscle out smaller competitors in the mapping software market. Here's what Bottin Cartographs' lawyer, Jean-David Scemmama, had to say on the ruling:

"We proved the illegality of (Google's) strategy to remove its competitors... the court recognised the unfair and abusive character of the methods used and allocated Bottin Cartographes all it claimed. This is the first time Google has been convicted for its Google Maps application."

Google, predictably, disagrees with the decision:

"We will appeal this decision. We remain convinced that a free high-quality mapping tool is beneficial for both Internet users and websites. There remains competition in this sector for us, both in France and internationally."

It's up to the French courts to decide how Google's allowed to operate in their country, obviously, but it's worth noting that both sides have an understandable point. On one hand, when Google enters a market, millions of users will end up using the service by default, and industries are affected. Remember when TomTom's and Garmin's stock prices plummeted the day turn-by-turn navigation was introduced in Android 2.0? So do we.

On the other hand, the trend towards major software companies covering all the major bases isn't going away. Apple, Google, and Microsoft are all expanding their software offerings to become your one-stop shops. Microsoft is building out Bing services at a loss, Apple spent billions on giant data centers to create iCloud, and Google is no stranger to buying up companies to build new services. Large companies simply have resources to invest in innovation that smaller startups can't afford.

It's hard to deny that Google Maps has pushed innovation forward and lit a fire under competitors' feet. What do you think, though? Is it fair for Google to provide services for free that other competitors have to charge for? Or are smaller companies doomed if they have to compete with free?

Source: AFP

Eric Ravenscraft
Eric is a snarky technophile with a taste for the unusual. When he's not obsessing about Android, you can usually find him obsessing about movies, psychology, or the perfect energy drink. Eric weaves his own special blend of snark, satire, and comedy into all his articles.

  • ocdtrekkie

    I don't understand from this text what they did that was illegal. In what way did Google's methods of making Google Maps show "abusive character"?

    • Zomby2D

      From what I gather, the only thing they supposedly did wrong is offering their product for free. And it's not like they stole the data they're giving away... I'm pretty sure they pay a good amount of money for those maps.

  • Yourissues

    Even if Google charged for it I think those other companies would still complain. Google is the leader of FREE. Email services, web browser, Android, all of it is free solely to promote the spreading and usage of technology. If your specialty is Maps, mapping, or land routes, which you have been doing and leading for 50 + years and you let a SEARCH engine company come out of no where with a free product that blows yours out of the water. Well you may want to start asking yourself WTF have we been doing all this time? Tired of people blaming Google for offering free services that destroy their business. Clearly the paid service you offer doesn't give me the flexibly that this free service does or the benefit.. when it does than we can talk..til than shut the hell up...... end rant

    • sriracha

      nandroid.

      furthermore, ah.. okay, there's nothing to add. pure nandroid Yourissues_02/02/12_1335.

  • Scott

    How are any small businesses who only have one product (i.e. Maps or any of their other products) supposed to compete with a company like Google who gives it away for free, and takes a loss in it, funding it with the profits of other products (search advertising, etc.)?

    This is EXACTLY why predatory pricing laws are in place. Everyone thinks Google is awesome until the day they release a product that puts your company out of business because you can't give it away for free.

    • http://www.AndroidPolice.com Artem Russakovskii

      So Google should charge for it? Will that make it right? How are you going to prohibit a company from making a free product?

      Should they make a premium version you have to upgrade to too? Would that make it OK?

    • cosmic

      I've seen this type of comment before and I still have to ask, how do you know they're taking a loss? As far as I'm aware they support it with ads and I'm sure making a decent bit of money.

      Anyway here is how companies beat free products, they make a better one. That is why netflix is doing fine even though google has free movies on youtube. Same reason why Word is doing fine even though there are Google Docs.

      To list a few other non google examples: Same reason xbox live is doing very well even though PSN is free. Same reason Starbucks is doing fine even though mcdonalds sells cheap drinks. Same reason cable/satellite companies are doing fine even though public tv is free. Same reason why Windows is doing fine despite free OS's. etc.

      • bstag

        Shh you are not allowed to bring common sense in to this conversation.

  • Ken

    Sounds like Internet Explorer.

  • Arben

    This is absolutely absurd. "We can't compete because our competitors are just better than us. Not only that, they don't even charge for it. Litigation time!"

  • Falconator

    If this company in question provided a better service, they wouldn't need to worry about Google Maps.

    Google offers a free document editor, but I still choose to pay for MSOffice services because it provides me with MORE of what I need to accomplish on a daily basis.

    If that's the case, let Google pull the Map application from French market for a week and I can almost guarantee that even Bottin Cartographs will complain that they want Google Maps back.

  • http://super-bancuri.ro Trif ovidiu

    The service is not free at all, you have a limited maps access/day. If you want more you pay, and pay a lot.

  • Mauricio

    Google: 500,000! let me search my pocket, I should gave some change!

  • miso_sori

    This is ridiculous, in the free market you must create value in your product that will convince others that it is worth spending their hard earned money. If Bottin Cartographes wants to stay in the game they need to differentiate themselves and provide a service people value as much or more than the cost of the service.
    Google has done this, obviously Bottin has not and that's the problem.
    Sorry I forgot we are talking about France here. Free market what?

  • Golightly

    I see Googs dropping more than 500k in legal fees to grind these shite disturbers into the ground.

  • Freak4Dell

    Your article leaves an important bit out. The other company is claiming that Google is only offering it for free until it runs the other providers out of business, and then Google will start charging.

    My question is, do French courts also convict random people off the street because they might rob a bank or murder somebody in the future?

    Aside from there being absolutely no proof whatsoever that Google is dumping (technically impossible, since dumping requires that a company charge less when exporting a product than it charges in its home market), as other people have pointed out, if this French company wants to stay competitive, all they need to do is make their products better. There are several free solutions for productivity software, yet Microsoft still makes a killing on Office. GIMP is a free alternative to Photoshop, yet Adobe is still afloat.

    Even with Maps online and built in on Android phones and tablets, we don't see Garmin and TomTom throwing a fit. They figured out how to convince people to still buy their products, and they continued working in markets that Google isn't involved in.

    I thought the Apple lawsuits were about as stupid as lawsuits could get, but I should have known the French would prove me wrong.

    • Eric Ravenscraft

      "I thought the Apple lawsuits were about as stupid as lawsuits could get, but I should have known the French would prove me wrong."

      I would like to award you +1 internet for this line.

  • Andrew A.

    Chain gas stations do it all the time. They sell their fuel with a price below market and either make the mom and pop gas station match it at a loss or they take all their customers. It's a war of attrition. The deeper pockets win. The day after the mom and pop closes the chain gas station ups the price above market.

  • Lucian Armasu

    Next, the Post Office in France is going to sue Google for offering "free mailing service"...and win.

    France is weird like that.

  • limowreck11

    This is an easy fix... charge say 3-4 dollars for the use of google maps in France -> Use money to pay the fine -> let Bottin Cartographs deal with the public backlash ^_^

    • Paul

      lol! I love it. So if the governement makes them charge for their product, charge some very low price, like $3-$4, which people would still do, but make heavy mention that they can thank Bottin Cartographs for the fee. lol.

  • Bonerp

    is there anything in law that says you have to charge for products you make which are associated to another product you sell? Isnt that maintaining your own competitive edge? I could understand if google went round and took over all these other products in france but they havent.
    Lets just think about how sensible this is....France wants the rest of europe to follow them to bankruptcy....its great being a 'European'. So proud.

    • Paul

      yeah, who are they to tell Google what they can and can't charge for their products/services? If I want offering computer services to everyone for free until Best Buy's geek squad is out of business, then that's my perogative. To have the government knocking on my door saying "You have to start charging people for your services" is just plain nuts.

  • Saúl
  • Kryptus

    ESRI is doing fine with ArcGIS even if they sell highly priced products. They just do have much better products than google will ever have. You can even use bing map for the imagery instead of their own map.

    So please, if you are incompetent and cannot sell your crappy products that are not even better than what people can get for free, please stop complaining and accept that you are just not good enough to keep you business running.

  • Dmitry Pashkevich

    Gosh, the companies should change their revenue models! Some things just MUST be free these days, and Google demonstrates that. This is like media companies trying to fight piracy...

  • Paul

    So dumb. If I want to offer my product/service free, then I should be allowed to, even if I take a loss on it. I mean, if Dell wanted to offer their computers and laptops severely discounted or even free then they should be allowed to. The complaint is, Google will offer mapping free until every other map maker is out of business, and then Google will jack up their prices and nobody will have any choice. Umm, if Google did that wouldn't the people/companies they put out of business re-emerge, and be cheaper than Google? If Apple sold laptops/computers cheaper/free until Dell was no more, and then jacked their costs up afterwards, wouldn't Dell and/or other companies re-emerge? I just don't believe the government can tell you what you can and can't do with your product and what you can and can't charge for it. That's too much meddling.

    • http://twitter.com/Telanis_ Telanis

      The problem is that consumers are affected and not only the companies.  If Apple ran its competitors out of business by relying on its giant load of cash while underselling everyone else, the options available to the consumer would be greatly diminished: buy Apple or go home.  And no, destroyed companies do not generally re-emerge, and especially not quickly.  You can't build a giant international corporation overnight, even when not bankrupt.  Monopolies are bad for the consumer, bad for the economy, and bad for innovation and human progress.

  • http://verb0ze.net verboze

    I don't know the details, so I won't judge, but... damn, I thought only US corps used the court to weed out competition XD. I'm torn. On one hand, it is true that the mega corps hold too much power and can saturate the market, but at the same time, when they do so by providing services users actually want without a lock-in mechanism, is it the courts' position to rebalance competition in the market?

Quantcast